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Non-independent Research Daily Base Metals Report

Non-independent Research

Daily Base Metals Report

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Authors
Dariaefanova

Daria Efanova Research Associate

Contact research Contact Industrial Commodities

US stocks extended yesterday’s gains on the back of another day of strong corporate earnings results; slowing market growth is already priced in by markets, and upbeat corporate earnings result in positive gains on the day. At the same time, according to Bank of America, global growth and profit expectations sank to an all-time low, while recession expectations reached the highest since May 2020. The dollar retreated, and the 10yr US Treasury yield edged back above 3.00%. The euro rose to the highest level in two weeks, to 1.02, as expectations of 50bps from the ECB on Thursday have increased; the implied rate stands at 38bps. In the meantime, the ECB’s President Lagarde is redoubling efforts to forge agreement on a still-incomplete new crisis tool.

Mixed performance from the metals today as the dollar pulled back some of its gains. Aluminium fell back below the support level of $2,400/t to close at $2,389/t. In the meantime, both imports of exports of aluminium ore and alumina improved in May. According to SMM, In June, China imported 9.42m mt of aluminium ore and concentrate, a decline of 7.5% y/y; the alumina exports were at 190,000mt, a surge of 3,664.8% y/y. Copper followed suit; however, support at $7,235/t capped the downside losses to close at $7,277.50/t. Nickel fluctuated as it remained broadly unchanged on the day at $20,596/t. Lead and zinc performance diverged as the metals closed at $1,986.50/t and $2,948.50/t, respectively.
After a volatile run today, oil futures slumped back below $100/t; earlier today, the futures posted the biggest

advance since May. Natural gas prices continue to climb as the European Commission doesn’t expect Russia to restart a key natural gas pipeline this week. According to IMF, a cut-off in Russian natural gas supplies could result in a hit of 2.65% to the EU’s economy. Both gold and silver gained footing to trade at $1,712/oz and $18.81/oz, respectively.

For more in-depth analysis of base and precious metals, our Q2 2022 Quarterly Metals report is out now!

All price data is from 19.07.2022 as of 17:30

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

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